Sacramento Region Local Market Assessment

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Sacramento Region Local Market Assessment Sacramento Region Local Market Assessment for the Sacramento Area Council of Governments and the Rural Urban Connections Strategy prepared by Agriculture in Metropolitan Regions (AMR) U.C. Berkeley with Valley Vision and SAGE (Sustainable Agriculture Education) DRAFT December 17, 2008 TABLE OF CONTENTS 2 EXECUTIVE SUMMARY 1 1.0 INTRODUCTION 2 1.1 Background 2 1.2 Methodology Overview 2 2.0 FOOD CONSUMPTION 2 2.1 Key Findings 2 2.2 Introduction 2 2.3 Food Consumption in the Greater Sacramento Region 2 2.4 Beyond Commodities and Per Capita Consumption: What the Data Don’t Tell Us 2 2.5 Local Affinities for Local Foods 2 2.6 Healthy and Local? 2 3.0 FOOD DISTRIBUTION 2 3.1 Key Findings 2 3.2 Introduction 2 3.3 How it Works: An Overview of Food Distribution Sectors 2 3.4 Food Distribution Sectors 2 3.5 Sector-by-Sector Breakdown 2 3.6 Straight from the Farm: The Direct Sales Landscape 2 3.7 Food Flows in and out of the Region 2 3.8 Niche Market Distribution: Organic, Ethnic, and Small Farmer Foods 2 4.0 MARKETING CONNECTIONS 2 4.1 Key Findings 2 4.2 Introduction 2 4.3 “Buy Local” Campaigns 2 4.4 Branding and Labeling Efforts: “Locally Grown” and Beyond 2 4.5 Virtual Connecters 2 4.6 Other Connectors – Focus on Education 2 5.0 AGRITOURISM 2 5.1 Key Findings 2 5.2 Agritourism Overview 2 5.3 SACOG Region: Extent of Agritourism Operations 2 5.4 SACOG Region: Profiles of Agritourism 2 5.5 SACOG Region: Regulatory Environment 2 5.6 SACOG Region: Economics of Agritourism 2 5.7 Promotion of Locally Grown Food in the SACOG Region 2 6.0 LOCAL PERSPECTIVES - OPPORTUNITIES AND CHALLENGES TO EXPAND THE REGION’S LOCAL FOOD SYSTEM 2 6.1 Key Findings 2 6.2 Challenges Affecting the Expansion of Local Foods within the Region’s Marketplace 2 6.3 Opportunities for Expanding the Local Food System 2 6.4 Ideas for Innovations 2 Executive Summary Over the last several years, there has been a growing interesting among consumers about the source of their food. What started as demand for “organic” food has evolved to demand for “locally- and sustainably-produced” food. Some people are concerned with food safety, others about taste and freshness, some with environmental benefits, while others view local food production as a vestige of our heritage worth preserving and enhancing. For producers, their customers’ concerns and interests are their own concerns and interests, provided that meeting these objectives correlates with meeting their financial bottom line. While enterprises and a body of literature have developed around the local food niche, there is a shortage of data to understand the impact of this movement on food systems in the SACOG region. Nonetheless, there are plenty of local market examples in each county in the region – some of which were seen on agriculture tours for the SACOG Board of Directors throughout 2008 – and enough interest with producers, retailers, and distributors in addition to consumers, that an entire working group for the Rural-Urban Connections Strategy project has been formed to better understand the opportunities for local markets and agritourism. These opportunities are part of the larger topic of new economic opportunities in agriculture and present a possible new revenue stream for farmers and ranchers. To understand the challenges to fostering a market for local food, we need to first understand how today’s food system works. Generally, we have a food system that has evolved to support large- scale agriculture and large retailers. Food is trucked into and out of the region daily since the bulk of the production in the region meets very little of our demand. And even where we do grow enough of one crop or another, the conventional food system is not well suited to channel sufficient amounts of that crop directly to meet the local consumer demand. This disconnect means that “food flows” are more extensive than they might be if local demand was better served with local production. However, local food systems are already being seen by the increasing popularity of farmers markets, Community Supported Agriculture boxes, agritourism, and nascent demand at restaurants, schools, and other institutions. The extent to which these venues and others become markets for local food requires further analysis. The RUCS team with the help of the Local Market and Agritourism working group is delving into this question, as well as trying to better understand how this market opportunity affects transportation and land use needs to support it. This paper begins to help the region better understand the current food system and the challenges and opportunities to promoting a local food system. What we produce and what we consume Food is produced in abundance in the SACOG region. Overall, the region produces over 3.4 million tons of food annually. Based on USDA data, we can estimate that the SACOG region consumes 2.2 million tons of food annually. Breaking this down by county, three of the six counties in the SACOG region consume more than they produce by weight: Sacramento County (~twice as much), El Dorado (~41 times as much), and Placer County (~six times as much). Yolo, Sutter, and Yuba Counties each produce around eight times more food than their residents consume by weight. However, when we consider product-specific production, there are notable imbalances. While regional production of vegetables equals 1,812,834 tons annually, 93% of that number is in tomato production alone, much of which leaves the region for processing. Of the 760,320 tons of grain produced in the region, 90% of that is in rice production. However, the vast majority of that rice is exported to Asia and the Middle East, sold domestically as table rice, or used in industrial processes 1DRAFT 12/18/2008 Sacramento Region Local Market Assessment 1 or rice products (i.e. Rice Krispies). The region actually consumes less than 2% of the rice produced here. Finally, in the category of meat and eggs, the region consumes a whopping 1,262% compared to what it produces, meaning this food sector is served almost exclusively by products transported into the region via truck or train. This imbalance between the types of food the region consumes and the foods we produce might present a new local market opportunity for farmers and ranchers, as long as barriers within the local foods distribution system could be adequately addressed. Distribution The food distribution system in the region is very efficient for moving food in and out of the region, but not necessarily for moving food from producer to consumer within the region. The system is geared towards larger scale commercial operations and larger scale movement of food. For smaller or mid-size producers, the distribution system may not be quite as user friendly, particularly for those producers focused on local distribution. Additionally, increased consolidation of grocers and wholesalers has resulted in a reduced number of the outlets that focus on selling of locally-produced foods. An increase in sourcing food locally will need distribution systems geared toward the local producer as discussed below. The implications of local food distribution system on the transportation system will need further study, however, the general construct draws from an analogy to the Blueprint where a prime objective of bring jobs and housing closer together is to reduce vehicle miles of travel. For food systems, the closer the producer is to the consumer, the fewer “food miles” of travel. Consumer demand? While the limited scope of local food comes from several causes, one primary cause repeatedly arose during this research: lack of demand. Education gaps about the benefits and availability of local foods hinders expansion of the system. Also, local often means organic, which increases the cost throughout the system, particularly at the consumer end. Lack of consumer demand has also affected data gathering within the distribution system. Even for distributors who have expressed a desire to track the origin and provenance (defined as…..) of the food they supply, the system does not easily enable this type of accounting. A lack of demand means there’s no pressure at any given point to change tracking in any part of the system. Successes But there are promising signs on the horizon. Increases in customer volume at area farmer’s markets along with increased participation in Community Supported Agriculture (CSAs), suggest a rising interest in purchasing locally-produced food. A robust agritourism sector and successful branding campaigns speak to the desire of urban dwellers to increasingly reconnect with the region’s agricultural heritage. And passage of local ordinances and state regulations like AB 2168 that support direct marketing of agricultural products are early indications of legislative movement towards supporting a more sustainable food system. Challenges and Opportunities There are specific challenges that need to be overcome in order to expand the local food system, and there are opportunities we could seize upon that could change the current reality. Education gaps and education opportunities for consumers. While gaps in consumer education may be a primary cause of the lack of scope of local foods, these gaps present an opportunity for the region. This includes increasing educational opportunities for consumers, chefs, and grocery store produce buyers to learn where to buy local, health benefits of buying local, what’s in season, and how to use seasonal produce. Additionally, the region can build on the success of existing farm visit programs for school groups and increase the number of children participating on hands-on farm experiences.
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